: Array-based analysis of chromatin immunoprecipitation data (ChIP-chip) is a powerful technique for identifying DNA target regions of individual transcription factors. Here, we present three approaches, a standard log-fold-change analysis (LFC), a basic method based on a Hidden Markov Model (HMM), and an extension of the HMM approach to an HMM with scaled transition matrices (SHMM) to incorporate different promoter pair orientations. We compare the prediction of ABI3 target genes for the three methods and evaluate these genes using Genevestigator expression profiles and transient assays. We find that the application of the SHMM leads to a superior identification of ABI3 target genes. The software and the ChIP-chip data set used in our case study can be downloaded from http://dig.ipkgatersleben.de/SHMMs/ChIPchip/ChIPchip.html.